Farmers pin hopes on Japan trade talks

Prime Minister Tony Abbott is due in Japan next week and Australian farmers are hoping a free trade agreement between the two countries will be sealed in their favour.

Trade with Japan is worth about $52 billion to Australia each year, while the Japanese earn about $20 billon from the flow in the other direction.

The agreement is expected to cover the lucrative areas of resources, agriculture and education with the beef and dairy industries in particular hoping for a better deal.

Japan has traditionally been an important trading partner with Australia.

However Professor Andrew O'Neil, the director of the Griffith Asia Institute at Griffith University, Queensland says there have been fears in Japan in recent years that is has been overlooked, as countries such as Australia rush to bolster their relationship with China.

Professor O'Neil believes it will be difficult to ensure Australian agriculture gets all the tariff reductions it wants, as Japan is fiercely protective of its own agricultural industry.

However Lachie Hart, chair of the beef industry's Japan Australia FTA taskforce remains hopeful that the 38.5 per cent tariff on beef will be reduced to zero, even if it is a sliding scale over time.

Tim Reid, managing director of Reid Fruits and current Australian Farmer of the Year, knows the challenges of trading with Japan.

He says the Japanese are very discerning customers who expect the highest quality, but the reward for companies that break the Japanese market can be great.

He says it is vital a free trade agreement is signed, both for Australia and for Japan which may find itself out in the cold if countries bypass it, for other trading partners with better deals on the table.